Wall Street falls with financials amid credit card rate plan concern

NEW YORK – US stocks ended lower on Tuesday, led by a drop in financial shares as comments from JPMorgan executives added to worries about US President Donald Trump’s recent proposal for a cap on credit‑card rates.

Helping to limit the day’s decline, a report early in the day showed that a reading on US inflation for December came in as expected, leaving intact market expectations for interest rate cuts from the Federal Reserve this year.

Trump’s proposed 10% cap on credit-card interest rates would directly hurt financial companies’ profits, and top JPMorgan executives, including CEO Jamie Dimon, warned that Trump’s plan would also severely hurt consumers.

That extended this week’s selloff in financials over the proposal, which Trump made last Friday.

Shares of Visa fell 4.5%, Mastercard dropped 3.8%, and the financial sector fell 1.8%, leading declines in the S&P 500.

Shares of JPMorgan ended down 4.2%. The bank reported a better-than-expected quarterly profit but also a drop in investment banking fees.

“Financials are getting hit by Trump’s credit-card proposal,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York.

“It seems to be sinking in,” he said. “I think it’s going to be extremely difficult to have that become a reality, but it’s still out there.”

The Dow Jones Industrial Average fell 398.21 points, or 0.80%, to 49,191.99, the S&P 500 lost 13.53 points, or 0.19%, to 6,963.74, and the Nasdaq Composite lost 24.03 points, or 0.10%, to 23,709.87.

Results from JPMorgan and other companies on Tuesday also unofficially kicked off the fourth-quarter US earnings season.

Other big banks, due to report their quarterly numbers later this week, were also lower even as analysts expected most banks to post stronger results for the last quarter of 2025.

Delta Air Lines shares eased 2.4% as the midpoint of its 2026 profit forecast fell short of analysts’ expectations.

Earnings news overall for the reporting period will most likely be positive, said Oliver Pursche, senior vice president, adviser for Wealthspire Advisors in Westport, Connecticut, adding, “I suspect there are going to be some upward revisions” for 2026.

The day’s declines, he said, most likely reflect “a little bit of letting the air out of the balloon,” after recent record highs. The Dow and S&P 500 both registered record closing highs on Monday.

Advancing issues outnumbered decliners by a 1.15-to-1 ratio on the NYSE. There were 577 new highs and 77 new lows on the NYSE.

On the Nasdaq, 2,068 stocks rose and 2,701 fell as declining issues outnumbered advancers by a 1.31-to-1 ratio.

Volume on US exchanges was 18.68 billion shares, compared with the roughly 16.4 billion average for the full session over the last 20 trading days.

(Reporting by Caroline Valetkevitch in New York; Additional reporting by Medha Singh and Pranav Kashyap in Bengaluru; Editing by Maju Samuel and Matthew Lewis)